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2018 (1) TMI 1237 - AT - Income TaxDisallowing the deduction claimed u/s 54F - assessee has not invested the long term capital gains in purchase or construction of a new residential house within the period specified - Held that:- The assessee has filed the return of income on 25.7.2014 i.e. after issuance of the legal notice dt. 5.4.2014 to the vendor calling upon him to execute the registered sale deed in favour of the assessee by clearing the bank loan and receiving the balance sale consideration of ₹ 3.4 crores. Therefore, as far as the assessee is concerned, he was aware of the bank loan and also the default committed by the vendor in repaying the loan. Thus, the property was not without an encumbrance as on the date of filing of the return and there was no certainty of the transaction going through. In a case where the sale is not concluded or the agreement of sale is not certain to be honoured, the assessee could not have claimed to have purchased the residential property within one year before or within two years after the sale of the original asset or to have constructed the property within three years after the sale of the property for the purposes of claiming the deduction u/s 54F(4) of the Act. Thus, the disallowance of assessee’s claim u/s 54F is confirmed and the assessee’s grounds on this issue are rejected. Unexplained cash deposits - addition u/s 68 - Held that:- From the details filed by the assessee, it is seen that the assessee had agricultural income and also income from other sources and house property from the A.Ys 2012-13 to 2014-15 sufficient to explain the sources for the deposit of ₹ 6.00 lakhs. Therefore, the source for the deposit of ₹ 6.00 lakhs is accepted. However, as regards the source for the deposit of ₹ 20.00 lakhs, being the amount claimed to be withdrawn for purchase of property in the earlier year and re-deposited the same after the period of one year due to the transaction not materializing, is not acceptable. Therefore, the addition of ₹ 20.00 lakhs is confirmed. - Decided partly in favour of assessee
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